What You Need to Know About Flood Insurance

Why Should You Consider Flood Insurance in Your Policy?

According to the Federal Emergency Management Agency (FEMA), floods are the number one natural disaster in the United States. Most home insurance policies do not cover flood damage, and because of this, even one to two inches of water can cause thousands of dollars worth of damage to your home and property.

What Are The Two Main Types of Home Insurance Policies?

The two main types of home insurance policies are the open (or “all-risks”) plan and the standard (or “named perils”) homeowners policy. An all-risk plan covers losses incurred due to any risks, except for specific perils that are set apart by the insurer. The standard homeowners policy covers losses due to perils that are specifically listed in the policy such as a fire or windstorm causing direct physical losses, whereas the all-risks policy entails a broader range of coverage.

These policies are further bundled into five packages:

1. HO-1 Basic Homeowner
2. HO-1 Basic Homeowner
3. HO-2 Broad Basic Homeowners
4. HO-3 Special Extended Homeowner
5. HO-3 with HO-15 Comprehensive Homeowner
6. HO-8 Modified Homeowner

Learn more about these home insurance policy options with Williams Insurance here.

What is Flood Insurance?

Flood insurance is a type of property insurance that covers specific kinds of water damage to your home and personal belongings. It is meant for those whose homes are built in flood-prone areas. These homes are also qualified to benefit from the National Flood Insurance Program (NFIP) which mainly covers damage to the structure and foundation.

Flood insurance covers scenarios such as:

• A river, lake, or bay that overflows its banks
• A hurricane storm surge
• A heavy downpour that accumulates faster than it can drain
• A mudflow
• Melting snow that seeps into your home

Is Flood Insurance Required?

Flood insurance is not required for everyone. Many mortgage lenders require homeowners in high-risk flood zones to have flood insurance in order to obtain a loan. However, a lender may require you to hold flood insurance at any time, even if the company is not legally mandated to do so.

Flood Insurance works the same as many other insurance policy options. The insurance company will provide financial help if a flood occurs, as long as you continue to pay your premiums.

If you are interested in adding flood insurance to your policy, contact us at Williams Insurance today to learn more about your options!